Description
need of consumer protection act, objectives of consumer protection act, consumer redressal mechanism as well as procedure of complaint, appeal & remedies.
Consumer Protection Act 1986
AGENDA
? ?
Need, Evolution, Objectives: Sampada
Nayak
Consumer: Misha Tyagi ? Key Terms : Ann Varghese ? Scope & Objects : Aditi Kaikini ? Consumer Redressal Mechanism :
Nimit Jain
Procedure of Complaint,Appeal & Remedies : Ankur Bhardwaj ? Cases & Examples : Rajat Anand
?
1 Nov 2010 The Pfizer Lipitor Recall Incident
Need for Consumer protection
? ? ? ? ?
SOME GLARING FACTS 15%-20% medicines in India are fake 1 in 3 automotive parts are duplicates 10% of the FMCG market is accounted for by fake products 10% of major soft drinks sold are spurious 10% - 30% cosmetics & toiletries and packaged foods are counterfeits
Need For Consumer Protection
? ? ? ?
Taking a Consumer from being a king on paper to a king in reality. Though the consumer is the most powerful and motivating force in the production process , It also happens to be the vulnerable segment of the marketing system. In the wake of large scale production and the variety and choice conferred on the consumers, a consumer needs guidance which can only be appropriately provided by a consumer organisation.
Evolution of Consumer Act
? ? ?
?
?
The Indian Penal Code, Agricultural Production, Grading and Marketing Act, 1937, Drugs and Cosmetics Act, 1940. Indian consumer movement began with Passengers and Traffic Relief Association (PATRA) in Mumbai, in 1915. A number of acts like Indian Contract Act, Sale of Goods Act, The Essential Commodities Act, The Agricultural Produce (Grading and Marking) Act, The Prevention of Food Adulteration Act, The Standards of Weights and Measures Act have been enacted by the Indian legislature from time to time to protect the interest of the consumer. The emergence of the Consumer Education and Research Centre in Ahmedabad, in 1978, was a milestone in the consumer movement of India. It provided a thrust and a direction to the movement in terms of a result-oriented approach through effective uses of the law and the courts, and injecting professional inputs into the movement.
What is it?
?
Consumer Protection Act 1986 is a benevolent social legislation that lays down the rights of consumers & provides the promotion and protection of the rights to the consumers. The Act changed its dictum from Caveat Emptor ( let the buyer beware) to Caveat Venditor ( let the seller beware)
?
Consumer
Consideration Good & Services Defects & Deficiency
Manufacturer
Complainant
Complaint
Denial of Complaint
Consumer Dispute
Redressal Agencies
National Commission State Commission District forum
Objectives
?
Protection of Consumer Rights Encourage high level of ethical conduct Curbing abusive business practices Provides quick & low cost redressal mechanism
?
?
?
?
Facilitate development of independent consumer groups
Provide consumers with greater choices and low
?
Who Is A Consumer?
Buyer of GOODS for consideratio n
CONSUMER Section 2(d)
• INCLUDES user of such goods with approval of Buyer • DOES NOT INCLUDE person who obtains goods for resale or any commercial purpose
• INCLUDES beneficiary of such services with approval of first person • DOES NOT INCLUDE person who avails such services for any commercial purpose
One who hires or avails SERVICES for consideration
Eg : Child taken to hospital by his parents
Who Is A Consumer?
?
A person claiming himself as ?Consumer‘ should satisfy three conditions namely:
the service should have been rendered to him ? the service should have been hired by him ? he should have paid the consideration for hiring the service
?
Who Is NOT a Consumer?
A person is NOT a Consumer if she/he
o Obtains
goods or avails services for resale or any commercial purpose goods without consideration
o Buys o Hires
or avails services without consideration
?
Uses the goods without the approval of the person who has bought the good for consideration
Is beneficiary of the services without the consent of the person who has hired the services for consideration Obtains service under the contract of Personal service
?
?
Consumer
A few keywords to understand here are: ? Consideration: ? Benefit that each party receives from the transaction ? May be Paid or Promised or Partly paid and partly promised ? Completed transaction of Sale and Purchase Eg : Payment of direct or indirect taxes is not a consideration
Consumer
Commercial Usage v/s Personal Usage
DOES NOT INLCUDE use of Goods bought or Services availed by a person exclusively for the purpose of earning his livelihood by means of Self employment Carrying on an activity on a large scale for the purpose of earning Profit. Eg: Purchase of a computer by a business house
INLCUDES use of goods bought or services availed by a person for himself Eg: Purchase of a photocopier by a lady earning her livelihood
Consumer
Re-sale When the goods are not considered for immediate final consumption but for transfer, it is re-sale Eg : A manufacturer sells to a wholesaler who in turn sells to a retailer
?
Some instances of
?
A CONSUMER Bank Customers, Subscribers of Telephone, passenger travelling by train, nominee of the insured(beneficiary of a service), consumer of electricity, depositor of money
NOT A CONSUMER A patient receiving treatment in a govt hospital, a govt servant, purchaser of shares, student hiring services of a personal tutor(contract of Personal Service)
?
?
o
Consumer Dispute
Key Terms
A person against whom complaint is made , denies or disputes allegations in complaint
?
Complainant
? A consumer ? Voluntary consumer association registered under Indian Companies Act, 1956 ? Central or any state Government ? Group of consumers ? Legal heir in case of death of the consumer
?
?
Complaint :
Made against ? Unfair trade practices ? Defects in goods or deficiencies in services ? Excess price charged ? Goods or services are hazardous to life
Key Terms
?
Unfair Trade Practices
? ? ? ? ? ? ? Making a Statement Publication Gifts and Prizes Withholding any scheme Sales or supply of goods Spurious Goods Hoarding
?
Restrictive Trade Practices
? Tends to bring about a manipulation of prices or its conditions of delivery/supply of goods ? Delay in delivery of goods/services ? Trade practice which requires consumer to buy as a precedent for another
Key Terms
?
Defects
? Any fault, imperfection or shortcoming in the quality, quantity, potency in GOODS ? (Goods defined under Sale Of Goods Act, 1930) ? Case : Ravindra Singh Jamwal Vs Prem Nath Motors Pvt Limited(1991)
?
Deficiency
? fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance of SERVICE ? (The services should not be availed free of charge) ? Case : Premlata vs National Insurance Co(1991) ? Case : Gen Manager, Southern Railway, Madras vs N.Prabhakaran(1992)
Key Terms
?
Excessive Price
? ? ? ? A price in excess of Fixed by or under any law in force Displayed on goods Displayed on Package
?
Hazardous Goods/Services
? In contravention of standards set by law ? With due diligence could have been avoided by the trader
Scope of the Act
Goods & Services of all categories & description ? Only ?Business to Consumer? disputes ? No privity of contract: Manufacturer, Importer, Retailer are all liable ? Public Sector Undertakings are also included
?
Objects of Consumer Protection Act
?
Right to Safety ? Against goods & services hazardous to life & property. Right to Information ? Access to complete information to assess the true value, quality, suitability, safety or reliability of any product. ? Advertisements, Word of mouth, Standard Labeling Conventions. Right to Choose ? To have access to a variety of goods and services at
?
?
Consumer Rights
?
Right to be heard ? Consumer's interests will receive due consideration at appropriate forums. Right to Consumer Education ? Formal education through school and college curriculums ? Consumer awareness campaigns ? Governmental & NGO initiatives Right to Redressal ? Redressal agencies at district, State & national level. ? Each of these agencies has geographical jurisdiction and case amount limits to address consumer cases.
?
?
Consumer Grievances
DUAL MACHINERY
Protection Of Rights
Redressal Agencies: 3 Tier Quasi Judicial Machinery
•The Central Consumer Protection Council. •The State Consumer Protection Councils.
•District Consumer Disputes Redressal Forum
•State Consumer Disputes Redressal Commission •National Consumer Disputes Redressal Commission
CONSUMER PROTECTION COUNCILS
Council
Central
Chairman
Members
Meetings
Consumer
Protection Council.
Other official & non Consumer Affairs in – official members Atleast 2 meetings who represent such every year Central interest Government Other official & non – official members Minister of who represent such Atleast 2 meetings every year Consumer Affairs in interest but not exceeding ten State Government members.
Minister of
The State Consumer Protection
Councils.
CONSUMER DISPUTE REDRESSAL AGENCIES
•District Consumer Disputes Redressal Forum
•State Consumer Disputes Redressal Commission
•National Consumer Disputes Redressal Commission
CONSUMER DISPUTES REDRESSAL AGENCIES
Amount of Compensation YOU Seek District Consumer Serving, retired or a Two other members; at least one must be a woman At least two other members & at least one must be a woman Court President Other Members
Up to Rs. 20 Lakh
Disputes Redressal Forum qualified District Judge.
Serving, retired or a qualified Judge of a High Court.
Rs. 20 Lakh to Rs. 1 Crore
State Consumer Disputes Redressal Commission
Higher than Rs. 1
Crore
National Consumer Disputes Redressal Commission
Serving, retired or a qualified Judge of the Supreme Court
At least four other members at least one must be a woman
CONSUMER DISPUTES REDRESSAL AGENCIES
Amount of Compensation YOU Seek 1. Opposite Party Resides Up to Rs. 20 Lakh District Consumer Disputes Redressal Forum 2. Actually works 3. Cause of Action arises Court Territorial Jurisdiction
Appeals against the orders of any
Rs. 20 Lakh to Rs. State Consumer Disputes 1 Crore Redressal Commission District Forum within the State
Higher than Rs. 1 National Consumer Disputes Crore Redressal Commission
Appeals against the orders of any State Commission
QUALIFICATIONS
Two other members, one of whom shall be a woman, who shall have the following qualifications, namely:— ? (i) be not less than thirty-five years of age, ? (ii) possess a bachelor's degree from a recognised university, ? (iii) be persons of ability, integrity and standing, and have adequate knowledge and experience of at least ten years in dealing with problems relating to economics, law, commerce, accountancy, industry, public affairs or administration. ? (iv) NO criminal record ? (v) NOT an undischarged insolvent
DISMISSAL OF FRIVOLOUS OR VEXATIOUS COMPLAINTS
• Reasons are recorded in writing,
•
•
Dismiss the complaint Complainant shall pay to the opposite party such Cost, not exceeding ten thousand rupees, as may specified in the order.
PENALTIES • Imprisonment for not less than 1 month but can extend to 3 yrs or a Fine not less than 2000 (up to 10000), or both.
32
CASE LAWS ON THE ACT
PECUNIARY JURISDICTION • In Krishan Dass Chaurasia V. State Bank of India (1995) the total claim in a complaint did not exceed Rs. 1,00,000/-. It was held that the matter was not within the jurisdiction of the State Commission and such a claim was rejected by the State Commission. The Complainant could seek the remedy from the District Forum. Therefore, jurisdiction, which is vested in a district Forum cannot be created for State Commission by merely exaggeration of a claim. • In B. Raghunath Vs Trans India Tourism (1996) the complainant had suffered a loss of Rs. 5,000/-, according to his own statement. He claimed compensation of Rs. 5,00,000. It was evident that he had purposely boosted his claim to bring the matter within the pecuniary jurisdiction of the State Commission.
33
CASE LAWS ON THE ACT
NO ACTION WHERE NO TERRITORIAL JURISDICTION
In J. K. Synthethetics Vs. Smt. Anita Bhargava (1993) the registered office of the Opposite Party was situated at Kanpur.
Payment was made through Bank in Delhi.
The complaint filed in Calcutta was held to be outside the territorial jurisdiction of the District Forum. The Order passed by the Calcutta District Forum was set aside in Appeal
34
CASE LAWS ON THE ACT.
REMAND WHEN ORDER SIGNED BY PRESIDENT ONLY
•
•
•
In S. Ravisankar Vs. Aslo Steel Ltd., the order of the District forum was signed only by the President of the Forum. No other member had signed it. Section 14 requires that every order shall be conducted/signed by the President and at least one member. The present order was held to be invalid, and the matter was remanded to the District Forum. (Raj kumar Mangla Vs. R.S. Singh (1995)
35
CASE LAWS ON THE ACT.
NON-SPEAKING ORDER CAN BE SET ASIDE
•
In S.D.O. Telephone Vs. Rama Shankar Pandey (1997) the District Forum, Handoi, allowed the complaint and directed that the telephone bills of the complainant be revised on the basis of average consumption and awarded Rs. 200/- compensation to the complainant. No reasons were given for such order. The State Commission held that the order of the District Forum should be a speaking one. It should give, however briefly, the essential facts and material, considered by it as well as the reasons for the conclusion. Else the order becomes arbitrary in the eyes of law.
The order of the District Forum was set aside and the case was sent back to the District forum for re-consideration in accordance with law after notice to the parties.
•
•
36
CASE LAWS ON THE ACT.
PREGNANCY NO GROUND FOR CONDONATION OF DELAY
•
In Registrar, University of Pune Vs. Mrs. Puja Pravin Wagh (1999) the complainant filed a complaint 3 1/2 months after the expiry of the limitation period of 2 years against the University of Pune for the wrong declaration of result. The reason for delay in filing the complaint given by the complainant was her pregnancy. The District Forum condoned the delay and awarded compensation of Rs. 2,50,000/- to the complainant. On appeal it was held that the fact of pregnancy was no justification for the delay. The complaint being time barred the order of the District Forum was set aside.
37
CASE LAWS ON THE ACT.
DAMAGES
In Provident Fund Commissioner Vs. Shiv Kumar Joshi (2000) the Supreme Court has held that an employee, who is a member of the Employees‘ Provident Fund Scheme, is a consumer and duties performed by the Regional Provident Fund Commissioner under such scheme is ?service? and thus, in case of delay in release of provident fund, complaint for deficiency in service, is maintainable.
38
Filing a complaint
Who ?
How ?
Who can file a complaint ?
?
To whom such goods are
? ? ? ? ? ? sold or delivered or agreed to be sold or delivered or such service provided or agreed to be provided
Who can file a complaint ?
?
Voluntary consumer association (COPA
1956)
? ?
One or more consumers The Central or the State Government.
Back
Process of filing a complaint
Complaint should be filed within 2 years from the date on which the cause of action has arisen.
Supporting Documents (Cash Memo, Receipts etc) Complaint
File it in office of District/ State / National Forum office
Demand draft for prescribed fees should be paid along
Complaint can be filed by self or other person
Fee Structure for complaints
Sr. No
1. 2. 3. 4. 5. 6.
Value of Goods / Services and Compensation
Amount of Fees
Upto Rs. 1 lakh rupees Rs 1 lakh and aboive but less than Rs 5 lakh Rs 5 lakh and above but less than Rs 10 lakh Rs 10 lakh and above but less than Rs 20 lakh Rs 20 lakh and above but less than Rs 50 lakh Rs 50 lakh and above but less than Rs 1 crore
Rs 100 Rs 200 Rs 400 Rs 500 Rs 2000 Rs 4000
Appeal
District forum
State Commission
National Commission
Supreme Court
Appeal
?
Appeal shall be filed within thirty days. ? If decision is against the company, it can appeal only after depositing 50% of the compensation to be paid to you or ? Rs.25000/-( State Commission) ? Rs 35000/-(National Commission) ? Rs 50000/- (Supreme Court ), whichever is lesser.
?
Delay in filing appeal may be condoned if there is sufficient cause.
45
Remedies
? ?
Correct deficiencies in the product Repair defect free of charges
?
Replace product with similar or superior product Issue a full refund
?
Remedies
? ? ? ?
Pay compensation for damages / costs Withdraw the sale of the product Discontinue unfair/restrictive trade practice Corrective advertisement for misrepresentation
Case Studies
Spring Meadows Hospital Vs Harjot Ahluwalia
?
In January 1994, Harjot was admitted with high fever, diagnosed with Typhoid
?
Injected with Lariago, suffered Cardiac Arrest
Put on manual respirator, then shifted to AIIMS where he was put on auto respirator. Irrepairable damage had been caused to Harjot‘s brain, could only live in a vegetative state
?
?
Negligence on the part of Spring Meadows Hospital
?
Injection was to be given by doctor, but instead the nurse gave it. Commission found a clear dereliction of duty on the part of the nurse and the hospital. Awarded Rs 12.5 lakh as compensation to Harjot and Rs. 5 Lakh to his parents.
?
?
Contention of Spring Meadows Hospital
?
No payment had been made to the hospital Why compensation for parents? The Commission rejected the hospital‘s claim and awarded the compensation amounts mentioned above.
?
?
29-11-2010 ECONOMIC TIMES
Indian Consumer Protection Act & Product Recall Policy
?
Product recall policy at a nascent stage in India Consumers are unaware of the rules and regulations
?
?
Regulations in developed nations are strict enough to even lead to prosecution. China – Sanlu Group had to withdraw all its milk products after a contaminant was found in their products
?
What Is Not Working?
?
In India, the government cannot force any company to recall its faulty products without the intervention of the judiciary.
By and large, product recall is voluntary in India, except for food and nutrition products. Aggrieved consumer has to first approach the company for relief If company does not own up, then approach consumer courts which can be a long drawn legal battle
?
?
?
What Is Not Working?
?
Sometimes, consumers may not have even access to complete information This might weaken the case and work in favor of the manufacturer.
?
?
Moreover, the legal fraternity in India forces more on individuals rather than mass lawsuits.
In the US, federal agencies can order product recall for safety reasons. Consumer Product Safety Commission is responsible for household products
?
?
What Is Not Working?
?
Food and Drug Administration mandates medical services and drugs. Department of Agriculture monitors meat and poultry products Companies have not recalled products in India in spite of recalling them in Foreign Markets The Indian Consumer Protection Act, 1986, does not contain any provision for product recall Consumers Products are sold in India with a guarantee or warranty
?
?
?
?
What Is Not Working?
?
? ? ? ?
The liability of the seller is limited to a mere replacement of the product or removing the defects in the product. The Law does not obligate the seller to recall the entire range that may be defective. Consumer gets the right to receive the value of the products purchased But is it sufficient?? There should be a special provision under the Consumer Protection Act to compensate the consumer.
SUGGESTIONS
?
24 hour helpline to register consumer complaints should be set up in India Posting all names of recalled brands on a website
?
?
Weak laws to be strengthened
Product Safety Certification to check potentially dangerous products Both for Consumer‘s and Manufacturer‘s Advantage.
?
?
THANK YOU
References
Business Law For Management: Bulchandani Kr Legal Aspects of Business:Akhileshwar Pathak THE CONSUMER PROTECTION ACT, 1986 & RULES, 1987http://www.corecentre.co.in/Database/Docs/DocFiles/prote ction.pdfhttp://www.wikipedia.org/http://www.youtube.com/http://www.google.com/imghp : Google Images
doc_833194778.ppt
need of consumer protection act, objectives of consumer protection act, consumer redressal mechanism as well as procedure of complaint, appeal & remedies.
Consumer Protection Act 1986
AGENDA
? ?
Need, Evolution, Objectives: Sampada
Nayak
Consumer: Misha Tyagi ? Key Terms : Ann Varghese ? Scope & Objects : Aditi Kaikini ? Consumer Redressal Mechanism :
Nimit Jain
Procedure of Complaint,Appeal & Remedies : Ankur Bhardwaj ? Cases & Examples : Rajat Anand
?
1 Nov 2010 The Pfizer Lipitor Recall Incident
Need for Consumer protection
? ? ? ? ?
SOME GLARING FACTS 15%-20% medicines in India are fake 1 in 3 automotive parts are duplicates 10% of the FMCG market is accounted for by fake products 10% of major soft drinks sold are spurious 10% - 30% cosmetics & toiletries and packaged foods are counterfeits
Need For Consumer Protection
? ? ? ?
Taking a Consumer from being a king on paper to a king in reality. Though the consumer is the most powerful and motivating force in the production process , It also happens to be the vulnerable segment of the marketing system. In the wake of large scale production and the variety and choice conferred on the consumers, a consumer needs guidance which can only be appropriately provided by a consumer organisation.
Evolution of Consumer Act
? ? ?
?
?
The Indian Penal Code, Agricultural Production, Grading and Marketing Act, 1937, Drugs and Cosmetics Act, 1940. Indian consumer movement began with Passengers and Traffic Relief Association (PATRA) in Mumbai, in 1915. A number of acts like Indian Contract Act, Sale of Goods Act, The Essential Commodities Act, The Agricultural Produce (Grading and Marking) Act, The Prevention of Food Adulteration Act, The Standards of Weights and Measures Act have been enacted by the Indian legislature from time to time to protect the interest of the consumer. The emergence of the Consumer Education and Research Centre in Ahmedabad, in 1978, was a milestone in the consumer movement of India. It provided a thrust and a direction to the movement in terms of a result-oriented approach through effective uses of the law and the courts, and injecting professional inputs into the movement.
What is it?
?
Consumer Protection Act 1986 is a benevolent social legislation that lays down the rights of consumers & provides the promotion and protection of the rights to the consumers. The Act changed its dictum from Caveat Emptor ( let the buyer beware) to Caveat Venditor ( let the seller beware)
?
Consumer
Consideration Good & Services Defects & Deficiency
Manufacturer
Complainant
Complaint
Denial of Complaint
Consumer Dispute
Redressal Agencies
National Commission State Commission District forum
Objectives
?
Protection of Consumer Rights Encourage high level of ethical conduct Curbing abusive business practices Provides quick & low cost redressal mechanism
?
?
?
?
Facilitate development of independent consumer groups
Provide consumers with greater choices and low
?
Who Is A Consumer?
Buyer of GOODS for consideratio n
CONSUMER Section 2(d)
• INCLUDES user of such goods with approval of Buyer • DOES NOT INCLUDE person who obtains goods for resale or any commercial purpose
• INCLUDES beneficiary of such services with approval of first person • DOES NOT INCLUDE person who avails such services for any commercial purpose
One who hires or avails SERVICES for consideration
Eg : Child taken to hospital by his parents
Who Is A Consumer?
?
A person claiming himself as ?Consumer‘ should satisfy three conditions namely:
the service should have been rendered to him ? the service should have been hired by him ? he should have paid the consideration for hiring the service
?
Who Is NOT a Consumer?
A person is NOT a Consumer if she/he
o Obtains
goods or avails services for resale or any commercial purpose goods without consideration
o Buys o Hires
or avails services without consideration
?
Uses the goods without the approval of the person who has bought the good for consideration
Is beneficiary of the services without the consent of the person who has hired the services for consideration Obtains service under the contract of Personal service
?
?
Consumer
A few keywords to understand here are: ? Consideration: ? Benefit that each party receives from the transaction ? May be Paid or Promised or Partly paid and partly promised ? Completed transaction of Sale and Purchase Eg : Payment of direct or indirect taxes is not a consideration
Consumer
Commercial Usage v/s Personal Usage
DOES NOT INLCUDE use of Goods bought or Services availed by a person exclusively for the purpose of earning his livelihood by means of Self employment Carrying on an activity on a large scale for the purpose of earning Profit. Eg: Purchase of a computer by a business house
INLCUDES use of goods bought or services availed by a person for himself Eg: Purchase of a photocopier by a lady earning her livelihood
Consumer
Re-sale When the goods are not considered for immediate final consumption but for transfer, it is re-sale Eg : A manufacturer sells to a wholesaler who in turn sells to a retailer
?
Some instances of
?
A CONSUMER Bank Customers, Subscribers of Telephone, passenger travelling by train, nominee of the insured(beneficiary of a service), consumer of electricity, depositor of money
NOT A CONSUMER A patient receiving treatment in a govt hospital, a govt servant, purchaser of shares, student hiring services of a personal tutor(contract of Personal Service)
?
?
o
Consumer Dispute
Key Terms
A person against whom complaint is made , denies or disputes allegations in complaint
?
Complainant
? A consumer ? Voluntary consumer association registered under Indian Companies Act, 1956 ? Central or any state Government ? Group of consumers ? Legal heir in case of death of the consumer
?
?
Complaint :
Made against ? Unfair trade practices ? Defects in goods or deficiencies in services ? Excess price charged ? Goods or services are hazardous to life
Key Terms
?
Unfair Trade Practices
? ? ? ? ? ? ? Making a Statement Publication Gifts and Prizes Withholding any scheme Sales or supply of goods Spurious Goods Hoarding
?
Restrictive Trade Practices
? Tends to bring about a manipulation of prices or its conditions of delivery/supply of goods ? Delay in delivery of goods/services ? Trade practice which requires consumer to buy as a precedent for another
Key Terms
?
Defects
? Any fault, imperfection or shortcoming in the quality, quantity, potency in GOODS ? (Goods defined under Sale Of Goods Act, 1930) ? Case : Ravindra Singh Jamwal Vs Prem Nath Motors Pvt Limited(1991)
?
Deficiency
? fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance of SERVICE ? (The services should not be availed free of charge) ? Case : Premlata vs National Insurance Co(1991) ? Case : Gen Manager, Southern Railway, Madras vs N.Prabhakaran(1992)
Key Terms
?
Excessive Price
? ? ? ? A price in excess of Fixed by or under any law in force Displayed on goods Displayed on Package
?
Hazardous Goods/Services
? In contravention of standards set by law ? With due diligence could have been avoided by the trader
Scope of the Act
Goods & Services of all categories & description ? Only ?Business to Consumer? disputes ? No privity of contract: Manufacturer, Importer, Retailer are all liable ? Public Sector Undertakings are also included
?
Objects of Consumer Protection Act
?
Right to Safety ? Against goods & services hazardous to life & property. Right to Information ? Access to complete information to assess the true value, quality, suitability, safety or reliability of any product. ? Advertisements, Word of mouth, Standard Labeling Conventions. Right to Choose ? To have access to a variety of goods and services at
?
?
Consumer Rights
?
Right to be heard ? Consumer's interests will receive due consideration at appropriate forums. Right to Consumer Education ? Formal education through school and college curriculums ? Consumer awareness campaigns ? Governmental & NGO initiatives Right to Redressal ? Redressal agencies at district, State & national level. ? Each of these agencies has geographical jurisdiction and case amount limits to address consumer cases.
?
?
Consumer Grievances
DUAL MACHINERY
Protection Of Rights
Redressal Agencies: 3 Tier Quasi Judicial Machinery
•The Central Consumer Protection Council. •The State Consumer Protection Councils.
•District Consumer Disputes Redressal Forum
•State Consumer Disputes Redressal Commission •National Consumer Disputes Redressal Commission
CONSUMER PROTECTION COUNCILS
Council
Central
Chairman
Members
Meetings
Consumer
Protection Council.
Other official & non Consumer Affairs in – official members Atleast 2 meetings who represent such every year Central interest Government Other official & non – official members Minister of who represent such Atleast 2 meetings every year Consumer Affairs in interest but not exceeding ten State Government members.
Minister of
The State Consumer Protection
Councils.
CONSUMER DISPUTE REDRESSAL AGENCIES
•District Consumer Disputes Redressal Forum
•State Consumer Disputes Redressal Commission
•National Consumer Disputes Redressal Commission
CONSUMER DISPUTES REDRESSAL AGENCIES
Amount of Compensation YOU Seek District Consumer Serving, retired or a Two other members; at least one must be a woman At least two other members & at least one must be a woman Court President Other Members
Up to Rs. 20 Lakh
Disputes Redressal Forum qualified District Judge.
Serving, retired or a qualified Judge of a High Court.
Rs. 20 Lakh to Rs. 1 Crore
State Consumer Disputes Redressal Commission
Higher than Rs. 1
Crore
National Consumer Disputes Redressal Commission
Serving, retired or a qualified Judge of the Supreme Court
At least four other members at least one must be a woman
CONSUMER DISPUTES REDRESSAL AGENCIES
Amount of Compensation YOU Seek 1. Opposite Party Resides Up to Rs. 20 Lakh District Consumer Disputes Redressal Forum 2. Actually works 3. Cause of Action arises Court Territorial Jurisdiction
Appeals against the orders of any
Rs. 20 Lakh to Rs. State Consumer Disputes 1 Crore Redressal Commission District Forum within the State
Higher than Rs. 1 National Consumer Disputes Crore Redressal Commission
Appeals against the orders of any State Commission
QUALIFICATIONS
Two other members, one of whom shall be a woman, who shall have the following qualifications, namely:— ? (i) be not less than thirty-five years of age, ? (ii) possess a bachelor's degree from a recognised university, ? (iii) be persons of ability, integrity and standing, and have adequate knowledge and experience of at least ten years in dealing with problems relating to economics, law, commerce, accountancy, industry, public affairs or administration. ? (iv) NO criminal record ? (v) NOT an undischarged insolvent
DISMISSAL OF FRIVOLOUS OR VEXATIOUS COMPLAINTS
• Reasons are recorded in writing,
•
•
Dismiss the complaint Complainant shall pay to the opposite party such Cost, not exceeding ten thousand rupees, as may specified in the order.
PENALTIES • Imprisonment for not less than 1 month but can extend to 3 yrs or a Fine not less than 2000 (up to 10000), or both.
32
CASE LAWS ON THE ACT
PECUNIARY JURISDICTION • In Krishan Dass Chaurasia V. State Bank of India (1995) the total claim in a complaint did not exceed Rs. 1,00,000/-. It was held that the matter was not within the jurisdiction of the State Commission and such a claim was rejected by the State Commission. The Complainant could seek the remedy from the District Forum. Therefore, jurisdiction, which is vested in a district Forum cannot be created for State Commission by merely exaggeration of a claim. • In B. Raghunath Vs Trans India Tourism (1996) the complainant had suffered a loss of Rs. 5,000/-, according to his own statement. He claimed compensation of Rs. 5,00,000. It was evident that he had purposely boosted his claim to bring the matter within the pecuniary jurisdiction of the State Commission.
33
CASE LAWS ON THE ACT
NO ACTION WHERE NO TERRITORIAL JURISDICTION
In J. K. Synthethetics Vs. Smt. Anita Bhargava (1993) the registered office of the Opposite Party was situated at Kanpur.
Payment was made through Bank in Delhi.
The complaint filed in Calcutta was held to be outside the territorial jurisdiction of the District Forum. The Order passed by the Calcutta District Forum was set aside in Appeal
34
CASE LAWS ON THE ACT.
REMAND WHEN ORDER SIGNED BY PRESIDENT ONLY
•
•
•
In S. Ravisankar Vs. Aslo Steel Ltd., the order of the District forum was signed only by the President of the Forum. No other member had signed it. Section 14 requires that every order shall be conducted/signed by the President and at least one member. The present order was held to be invalid, and the matter was remanded to the District Forum. (Raj kumar Mangla Vs. R.S. Singh (1995)
35
CASE LAWS ON THE ACT.
NON-SPEAKING ORDER CAN BE SET ASIDE
•
In S.D.O. Telephone Vs. Rama Shankar Pandey (1997) the District Forum, Handoi, allowed the complaint and directed that the telephone bills of the complainant be revised on the basis of average consumption and awarded Rs. 200/- compensation to the complainant. No reasons were given for such order. The State Commission held that the order of the District Forum should be a speaking one. It should give, however briefly, the essential facts and material, considered by it as well as the reasons for the conclusion. Else the order becomes arbitrary in the eyes of law.
The order of the District Forum was set aside and the case was sent back to the District forum for re-consideration in accordance with law after notice to the parties.
•
•
36
CASE LAWS ON THE ACT.
PREGNANCY NO GROUND FOR CONDONATION OF DELAY
•
In Registrar, University of Pune Vs. Mrs. Puja Pravin Wagh (1999) the complainant filed a complaint 3 1/2 months after the expiry of the limitation period of 2 years against the University of Pune for the wrong declaration of result. The reason for delay in filing the complaint given by the complainant was her pregnancy. The District Forum condoned the delay and awarded compensation of Rs. 2,50,000/- to the complainant. On appeal it was held that the fact of pregnancy was no justification for the delay. The complaint being time barred the order of the District Forum was set aside.
37
CASE LAWS ON THE ACT.
DAMAGES
In Provident Fund Commissioner Vs. Shiv Kumar Joshi (2000) the Supreme Court has held that an employee, who is a member of the Employees‘ Provident Fund Scheme, is a consumer and duties performed by the Regional Provident Fund Commissioner under such scheme is ?service? and thus, in case of delay in release of provident fund, complaint for deficiency in service, is maintainable.
38
Filing a complaint
Who ?
How ?
Who can file a complaint ?
?
To whom such goods are
? ? ? ? ? ? sold or delivered or agreed to be sold or delivered or such service provided or agreed to be provided
Who can file a complaint ?
?
Voluntary consumer association (COPA
1956)
? ?
One or more consumers The Central or the State Government.
Back
Process of filing a complaint
Complaint should be filed within 2 years from the date on which the cause of action has arisen.
Supporting Documents (Cash Memo, Receipts etc) Complaint
File it in office of District/ State / National Forum office
Demand draft for prescribed fees should be paid along
Complaint can be filed by self or other person
Fee Structure for complaints
Sr. No
1. 2. 3. 4. 5. 6.
Value of Goods / Services and Compensation
Amount of Fees
Upto Rs. 1 lakh rupees Rs 1 lakh and aboive but less than Rs 5 lakh Rs 5 lakh and above but less than Rs 10 lakh Rs 10 lakh and above but less than Rs 20 lakh Rs 20 lakh and above but less than Rs 50 lakh Rs 50 lakh and above but less than Rs 1 crore
Rs 100 Rs 200 Rs 400 Rs 500 Rs 2000 Rs 4000
Appeal
District forum
State Commission
National Commission
Supreme Court
Appeal
?
Appeal shall be filed within thirty days. ? If decision is against the company, it can appeal only after depositing 50% of the compensation to be paid to you or ? Rs.25000/-( State Commission) ? Rs 35000/-(National Commission) ? Rs 50000/- (Supreme Court ), whichever is lesser.
?
Delay in filing appeal may be condoned if there is sufficient cause.
45
Remedies
? ?
Correct deficiencies in the product Repair defect free of charges
?
Replace product with similar or superior product Issue a full refund
?
Remedies
? ? ? ?
Pay compensation for damages / costs Withdraw the sale of the product Discontinue unfair/restrictive trade practice Corrective advertisement for misrepresentation
Case Studies
Spring Meadows Hospital Vs Harjot Ahluwalia
?
In January 1994, Harjot was admitted with high fever, diagnosed with Typhoid
?
Injected with Lariago, suffered Cardiac Arrest
Put on manual respirator, then shifted to AIIMS where he was put on auto respirator. Irrepairable damage had been caused to Harjot‘s brain, could only live in a vegetative state
?
?
Negligence on the part of Spring Meadows Hospital
?
Injection was to be given by doctor, but instead the nurse gave it. Commission found a clear dereliction of duty on the part of the nurse and the hospital. Awarded Rs 12.5 lakh as compensation to Harjot and Rs. 5 Lakh to his parents.
?
?
Contention of Spring Meadows Hospital
?
No payment had been made to the hospital Why compensation for parents? The Commission rejected the hospital‘s claim and awarded the compensation amounts mentioned above.
?
?
29-11-2010 ECONOMIC TIMES
Indian Consumer Protection Act & Product Recall Policy
?
Product recall policy at a nascent stage in India Consumers are unaware of the rules and regulations
?
?
Regulations in developed nations are strict enough to even lead to prosecution. China – Sanlu Group had to withdraw all its milk products after a contaminant was found in their products
?
What Is Not Working?
?
In India, the government cannot force any company to recall its faulty products without the intervention of the judiciary.
By and large, product recall is voluntary in India, except for food and nutrition products. Aggrieved consumer has to first approach the company for relief If company does not own up, then approach consumer courts which can be a long drawn legal battle
?
?
?
What Is Not Working?
?
Sometimes, consumers may not have even access to complete information This might weaken the case and work in favor of the manufacturer.
?
?
Moreover, the legal fraternity in India forces more on individuals rather than mass lawsuits.
In the US, federal agencies can order product recall for safety reasons. Consumer Product Safety Commission is responsible for household products
?
?
What Is Not Working?
?
Food and Drug Administration mandates medical services and drugs. Department of Agriculture monitors meat and poultry products Companies have not recalled products in India in spite of recalling them in Foreign Markets The Indian Consumer Protection Act, 1986, does not contain any provision for product recall Consumers Products are sold in India with a guarantee or warranty
?
?
?
?
What Is Not Working?
?
? ? ? ?
The liability of the seller is limited to a mere replacement of the product or removing the defects in the product. The Law does not obligate the seller to recall the entire range that may be defective. Consumer gets the right to receive the value of the products purchased But is it sufficient?? There should be a special provision under the Consumer Protection Act to compensate the consumer.
SUGGESTIONS
?
24 hour helpline to register consumer complaints should be set up in India Posting all names of recalled brands on a website
?
?
Weak laws to be strengthened
Product Safety Certification to check potentially dangerous products Both for Consumer‘s and Manufacturer‘s Advantage.
?
?
THANK YOU
References
Business Law For Management: Bulchandani Kr Legal Aspects of Business:Akhileshwar Pathak THE CONSUMER PROTECTION ACT, 1986 & RULES, 1987http://www.corecentre.co.in/Database/Docs/DocFiles/prote ction.pdfhttp://www.wikipedia.org/http://www.youtube.com/http://www.google.com/imghp : Google Images
doc_833194778.ppt